Correlation Between Wisekey International and CleanSpark

Can any of the company-specific risk be diversified away by investing in both Wisekey International and CleanSpark at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Wisekey International and CleanSpark into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Wisekey International Holding and CleanSpark, you can compare the effects of market volatilities on Wisekey International and CleanSpark and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Wisekey International with a short position of CleanSpark. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wisekey International and CleanSpark.

Diversification Opportunities for Wisekey International and CleanSpark

-0.7

Correlation Coefficient

Wisekey International  CleanSpark

Excellent diversification

The 3 months correlation between Wisekey and CleanSpark is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Wisekey International Holding and CleanSpark in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CleanSpark and Wisekey International is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Wisekey International Holding are associated (or correlated) with CleanSpark. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CleanSpark has no effect on the direction of Wisekey International i.e., Wisekey International and CleanSpark go up and down completely randomly.

Pair Corralation between Wisekey International and CleanSpark

Given the investment horizon of 90 days Wisekey International Holding is expected to generate 4.69 times more return on investment than CleanSpark. However, Wisekey International is 4.69 times more volatile than CleanSpark. It trades about 0.14 of its potential returns per unit of risk. CleanSpark is currently generating about -0.17 per unit of risk. If you would invest  210.00  in Wisekey International Holding on November 28, 2024 and sell it today you would earn a total of  285.00  from holding Wisekey International Holding or generate 135.71% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Wisekey International Holding  vs.  CleanSpark

Wisekey International

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Wisekey International Holding are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of fairly uncertain technical and fundamental indicators, Wisekey International showed solid returns over the last few months and may actually be approaching a breakup point.

CleanSpark

Risk-Adjusted Performance

Very Weak

Over the last 90 days CleanSpark has generated negative risk-adjusted returns adding no value to investors with long positions. Despite uncertain performance in the last few months, the Stock's basic indicators remain quite persistent which may send shares a bit higher in March 2025. The latest mess may also be a sign of long-standing up-swing for the company institutional investors.

Pair Trading with Wisekey International and CleanSpark

The main advantage of trading using opposite Wisekey International and CleanSpark positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wisekey International position performs unexpectedly, CleanSpark can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in CleanSpark will offset losses from the drop in CleanSpark's long position.

The idea behind Wisekey International Holding and CleanSpark pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the FinTech Suite module to use AI to screen and filter profitable investment opportunities.